Overstock.com, the first major retailer to accept Bitcoin (BTC) in 2014, has saw its shares fall after its cryptographic subsidiary tZERO reported that the US Securities and Exchange Commission (SEC) was reviewing its initial offer of parts (ICO), according to tZERO's "Trust Confidential Placement Offering Memorandum" of March 1.
Overstock October of last year at around $ 34, while more and more investors were excited about Blockchain and crypto. Overstock is currently trading around $ 56 after falling more than 10% on March 1st.
On February 28, anonymous sources told the WSJ that the SEC had launched an investigation into companies related to cryptocurrencies. – Still unknown number of requests for information and assignments already addressed to crypto companies. The SEC has also recently suspended the trading of three companies by investigating their cryptocurrency and Blockchain assets.
In a section entitled "Legal Proceedings", tZERO records that the SEC's Division of Enforcement had told the company in February that it was conducting an investigation and had requested the voluntary transfer of " some Documents relating to the Offer and Tokens in the course of its investigation . "
The March 1 filing also contains a list of "warnings" about the future, including the stipulation that it " can not be assured that the tokens will be issued and the tokens, if issued, will be subject to legal and contractual transfer restrictions to comply with our obligations . "The list also includes mentions of the" nature " uncertain "tax treatment, enforcement of US law and
The filing reports that the company cooperates with the SEC in its investigation, but adds that
Patrick Byrne, CEO of O verstock, said yesterday at the Wall Street Journal (WSJ), March 1, that the SEC " clearly makes a sweep of all this industry ," a move that he " actually supports : "
" After Byrnes, the SEC was " in the dark " about the ICOs, and most of the offerings are in fact the agenda
securities, even if they do not sell as such:
"We all know that
Overstock had requested that its ICO be classified under regulations D and S rather than a traditional securities depository. This means that US citizens must be accredited investors (net worth greater than $ 1 million or an annual income of at least $ 200,000) invested in the ICO, and that offshore transactions do not have to involve American citizens.
The SEC filing stated that the ICO, which was launched in December 2017, raised $ 100.6 million from 1,100 investors, and that $ 250 million represents the maximum amount of chips to be issued. The TZERO website indicates that the "Private Offering" had been extended until March 30, 2018.
In January of this year, the Eastman Kodak Company announced that they would release their own ICO under the same "exempt offer" the guidelines have seen the price of their shares double, but their launch date has been postponed to complete the verification of the status of their accredited investors.